Document4 Mailings Review View Grammarly Tell me Question 4: (26 marks) Ose How to ievilting project on purchase automation event to improve ita protection capacity. This project would require invest 1.2 million. The new equipment will have settlide of 10 years with dual value of 575.000 at your One w we reightline depreciation method With the automatiquipment, dictions are expected to increase by 8,000 per year for the years Selling price will remain 510 per unit. Total variable cost is still 512K per it, but the untul fixed costs will meraie by 5100,000 Allware med occur at the end of each year One Huwkevaluate this project wing 15% ultertux discutate. The corporate tax rate is generally 30% in Australia Reged Ghen the expected increase in vales, calculate the incremental before-tex prate for rach year. 15 marks Gent 1) Caleate the annual calater tachows for each year for the company's projecte purchasing the nation , || / et proper a few seconds, dicunt facu, www.conflue) was your company was the automatis apmest? Catate and interpretach of the following for the project/mark Net present value Retura ne u Gwl Sundfumention in Eredd er orietan ere Pahal periods End of the Dom Question 4: (26 marks) Ooo Hawk Ltd. is evaluating a project on purchasing new automation equipment to improve its production capacity. This project would require an initial investment of 51.2 million. The new equipment will have a useful life of 10 years with a residual value of $75,000 at year 10, One Hawk will use straight-line depreciation method. With the automation equipment, production and sales are expected to increase by 8.000 units per year for the next 10 years A Selling price will remain 5180 per unit. Total variable cont is still 5123 per unit, but the manual fixed costs will increase by 5102.000 All cashflows ato assumed to occur at the end of each year, One Hawk evaluate this project using a 15% after-tax discount rate. The corporate te re is generally 30% in Australia. Required: a) Given the expected increase in sales, calculate the incremental before-tex profit for each year. 15 marks) Click or tip here to etter et b) Calculate the annual incremental after-tax cash flows for each year for the company's project on purchasing the automation equipment. 114 marks (Hint prepare table of before and after tax annual caskyflows, discount factor, present value of annual cashflows) c) Based on your calculations, should the company invest in the automation equipment? Calculate and interpret each of the following for the project: market D) Net present value Click or tap here to court 1) Internal rate of Return (ffint: use Gool Setik function in Excel or trial and error method Gick or tag here to Payback periods Didkortet ates) Document4 Mailings Review View Grammarly Tell me Question 4: (26 marks) Ose How to ievilting project on purchase automation event to improve ita protection capacity. This project would require invest 1.2 million. The new equipment will have settlide of 10 years with dual value of 575.000 at your One w we reightline depreciation method With the automatiquipment, dictions are expected to increase by 8,000 per year for the years Selling price will remain 510 per unit. Total variable cost is still 512K per it, but the untul fixed costs will meraie by 5100,000 Allware med occur at the end of each year One Huwkevaluate this project wing 15% ultertux discutate. The corporate tax rate is generally 30% in Australia Reged Ghen the expected increase in vales, calculate the incremental before-tex prate for rach year. 15 marks Gent 1) Caleate the annual calater tachows for each year for the company's projecte purchasing the nation , || / et proper a few seconds, dicunt facu, www.conflue) was your company was the automatis apmest? Catate and interpretach of the following for the project/mark Net present value Retura ne u Gwl Sundfumention in Eredd er orietan ere Pahal periods End of the Dom Question 4: (26 marks) Ooo Hawk Ltd. is evaluating a project on purchasing new automation equipment to improve its production capacity. This project would require an initial investment of 51.2 million. The new equipment will have a useful life of 10 years with a residual value of $75,000 at year 10, One Hawk will use straight-line depreciation method. With the automation equipment, production and sales are expected to increase by 8.000 units per year for the next 10 years A Selling price will remain 5180 per unit. Total variable cont is still 5123 per unit, but the manual fixed costs will increase by 5102.000 All cashflows ato assumed to occur at the end of each year, One Hawk evaluate this project using a 15% after-tax discount rate. The corporate te re is generally 30% in Australia. Required: a) Given the expected increase in sales, calculate the incremental before-tex profit for each year. 15 marks) Click or tip here to etter et b) Calculate the annual incremental after-tax cash flows for each year for the company's project on purchasing the automation equipment. 114 marks (Hint prepare table of before and after tax annual caskyflows, discount factor, present value of annual cashflows) c) Based on your calculations, should the company invest in the automation equipment? Calculate and interpret each of the following for the project: market D) Net present value Click or tap here to court 1) Internal rate of Return (ffint: use Gool Setik function in Excel or trial and error method Gick or tag here to Payback periods Didkortet ates)